Poverty waits for no one, not even inquisitive senators

Article published 23 August 2019

Poverty waits for no one, not even inquisitive senators

THERE are over 700,000 Australians living on the Newstart Allowance. Currently, Newstart is $277.85 per week for a single person if all job seeking and volunteering commitments are met.

The Newstart Allowance is one of the lowest unemployment benefits with some of the strictest requirements paid by countries in the Organisation for Economic Co-operation and Development (OECD).

The payment adds up to less than two thirds of the Australian poverty line. With no increase in real terms for the past 25 years, Newstart is no longer a safety net but a thin cushion to soften the fall into poverty.

Community groups all over Australia have been calling for an increase to Newstart but so far have seen no action from Australia’s decision makers, apart from the announcement of a Senate Inquiry into the adequacy of Newstart.

Although this may seem like good news, the reporting date is 27 March 2020. This is an awfully long time to determine what has been stated by community groups, business groups and economists all over the country: a raise to Newstart is needed and would be beneficial to many.

Poverty will not be put on hold until March 2020.

People aged 55-65, who are now the largest group of people on the Newstart Allowance, stay on the payment for the longest period of time. At the same time, poverty rates are increasing in Australia even more for single older people.

The 2018 Household, Income and Labour Dynamics in Australia (Hilda) survey found that poverty rates for older single women were more than 30 per cent. The survey does not give reasons for the increase in poverty rates, but Professor Roger Wilkins, a Hilda co-author, says that moving people onto Newstart from higher paying benefits such as disability support pensions is having a big impact on the increase in poverty rates.

200,000 sick or disabled people are currently on Newstart, an increase of 50 per cent over five years. In 2015 eligibility rules for disability pensions were tightened kicking many people off the benefit.

While a Senate Inquiry considers whether people on Newstart should be able to afford both food and medicine, many more people will slide into poverty.

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